INCREASES ARE COMING - FROM OIL TO THE SHELVES, THE PRESSURE OF CONFLICT IN THE MIDDLE EAST - Filenews 12/4
The protracted conflict in the Middle East is beginning to exert strong pressures on the global energy market, with the limited availability of crude oil amplifying the risk of a broader supply crisis.
The restriction of flows through the Strait of Hormuz has significantly reduced the supply of oil and gas, affecting not only fuel prices but also the availability of key petrochemical raw materials. These are materials used in the production of a number of everyday products, from clothes and shoes to plastic packaging.
The consequences are already starting to pass on to the consumer market, with increases in the prices of plastics, rubber and polyester. Pressures are most acute in Asia, which is heavily dependent on imported energy and hosts a significant portion of global manufacturing activity.
Problems have already emerged in several countries, from mass purchases of basic materials and restrictions on the use of plastics to shortages affecting agriculture and healthcare. At the same time, industry bodies warn of potential difficulties in the production of medical supplies and other critical products.
Market players point out that the impacts are rapidly transferring from the energy sector to petrochemicals and from there to consumer goods, affecting a wide range of industries and products.
This development intensifies inflationary pressures internationally and weighs on economic activity, as production costs increase and are gradually passed on to consumers. At the same time, rising fuel and raw material prices are making transport and supply chains even more difficult.
Despite efforts by governments to limit the impact through strategic reserves, the shortage of critical derivatives, such as naphtha, remains a key problem, with no immediate and easy alternatives.
Market pressure has already led to production restrictions and force majeure by some companies, while competition for raw materials is intensifying.
Price increases are already evident, particularly in plastics, where significant jumps are recorded in some categories. At the same time, businesses are looking for alternative materials or considering limiting the use of plastic, although such options take time and entail additional costs.
The developments in Asia are seen as a warning sign of similar pressures in the West, as disruptions in supply chains are expected to extend in the coming months.
Analysts emphasize that the issue is no longer just about price increases, but also about the physical availability of basic materials, while the uncertainty surrounding the course of the conflict keeps the market on alert.
Even if there is a de-escalation, it is estimated that it will take months for the market to rebalance, especially in the petrochemical and plastics sectors.
